Despite Surging Popularity, Content Marketing Is a Fraction of 2015 Budgets

Study Says Most Marketers Earmark 25% or Less

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A native ad for Netflix that appeared on this year.
A native ad for Netflix that appeared on this year.

Content marketing is among the hottest topics in marketing and media. In a recent report from analytics firm eMarketer, for instance, several marketers expressed bullishness about the practice in the year ahead.

Budgets, however, don't seem to have caught up with the hype yet.

In a recent survey, 52% of marketers said one-quarter or less of their 2015 marketing budget is dedicated to content. The survey, which asked 601 marketers about their tactics around content, comes from Contently, a company that licenses software to brands to help them manage content-marketing projects and connects these companies with freelance writers.

Lack of budget was also the most cited challenge for content marketing efforts, with 34% of respondents noting it as their chief frustration. That was followed by inability to measure business results (22%) and lack of time (11%), according to the survey.

Content marketing refers to articles, videos, graphics and more from brands, designed to attract and engage audiences in the same manner that a media company does. Native advertising is part of this tactic and refers to ads that mimic editorial content surrounding it.

Sixty-nine percent of respondents said they prefer original content -- the kind their companies or agencies produce on their behalf -- over licensed content, which might be an editorial article created by a media company and repurposed for a brand website.

Budgets earmarked for content marketing are forecast to grow. An eMarketer report predicts marketers will spend $4.3 billion on native advertising in 2015, a 34% increase from this year. That number is expected to reach $8.8 billion by 2018.

According to Contently's survey, 23% of respondents are already devoting more than half their 2015 marketing budgets to producing content. "People spending more than 50% surprised me," said Sam Slaughter, VP-content at Contently. "That seemed very high."

The average Fortune 500 brand is probably spending between 26% and 50% of its marketing budget on content, he estimated. Dell, for instance, has dedicated that percentage of its budget to content marketing, according to the survey results. The survey also noted that Dell has more than 10 employees dedicated to the practice and publishes more than 20 pieces of content each week, excluding social media posts. Most respondents -- 57% -- have two or more people dedicated to content marketing.

Mr. Slaughter said content marketing is still gaining steam among brands. "A lot of people are wondering when we're going to hit the crest of the wave," he said. "From this survey, I don't see that happening this year. People are all in on this."

Companies like Contently, of course, are hoping to ride this wave as far as possible. The company, which received a $9 million investment this year, has seen revenue climb into the eight figures. Its staff has tripled in 2014. Other companies, such as NewsCred and Percolate, which offer similar services, have seen similar and even larger gains thanks to content marketing.

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